Tuesday, March 4, 2008

Schooling is not equal to Education

Human capital offers an interesting case study in theory versus data. Just as most people think it obvious that medicine deserves most of the credit for health gains, most people think it obvious that education deserves most of the credit for human capital gains. Do-gooders the world over have for centuries "known" that what the poor really need is more medicine and education (and religion and art).

We theorists will tell you that, yes productive people tend to be better educated, but there are many possible explanations for wealth-education correlations. For example, schooling could be a credible signal of ability, or school could be consumption that the rich can better afford.

Most who study education are data-crunchers with little patience with such abstract theorizing. But until recently they were troubled by the fact that data on nations across time seemed to show a negative relation between wealth and education, even after controlling for measures of physical capital! For example, see this 2001 Pritchett paper.

What Makes Finnish Kids So Smart?Finland's teens score extraordinarily high on an international test. American educators are trying to figure out why.By ELLEN GAMERMANFebruary 29, 2008; Page W1

Helsinki, Finland

High-school students here rarely get more than a half-hour of homework a night. They have no school uniforms, no honor societies, no valedictorians, no tardy bells and no classes for the gifted. There is little standardized testing, few parents agonize over college and kids don't start school until age 7.

Yet by one international measure, Finnish teenagers are among the smartest in the world. They earned some of the top scores by 15-year-old students who were tested in 57 countries. American teens finished among the world's C students even as U.S. educators piled on more homework, standards and rules. Finnish youth, like their U.S. counterparts, also waste hours online. They dye their hair, love sarcasm and listen to rap and heavy metal. But by ninth grade they're way ahead in math, science and reading -- on track to keeping Finns among the world's most productive workers.

Points:

What is valuable education

Education, skills and knowledge seem to me to be very valuable in general but schooling is only valuable to the individuals who do better than average and to a certain extent to employers for grading people. IMO schooling is more about testing than teaching. If one looks at school objectively it seems that one would come to this conclusion. School helps with some useful skills like reading and arithmetic but it teaches very little information that will be useful to the students in life. Students would seem to better of watching myth busters than in a class.

What are the returns to schoolingRichard Vedder has found that the statistics by state shows that those states that increase education spending faster have slower economic growth than similar states that increase education spending slower. More education spending means more taxes and maybe less spending on physical capital. In a diminishing returns case should we not all agree that at some point spending on education would have a negative effect on economic growth? So then the argument is about at what point we go negative not if we ever go negative. If you look at individuals, I am convinced that some students would be much better off if the money spent to school them was instead spent on physical capital that was then given to them. A poor student with 12 years of schooling will generally do less well that a poor student with 3 years of schooling and his own bulldozer and trailer to carry it to jobs.

How much instruction in neededThe un-schoolers are matching schools with minimal instruction and input. Most children, with individual instruction, can be taught to read, write and do addition, subtraction, multiplication and division in a very short period of time. So the returns on further instruction may start to decline rapidly a very low level of instruction.

Is it possible to educate those who do not care to learnTo paraphrase Murray Rothbard it seems that if a child does not want to learn and if his parents do care if he learns or not, the child will not learn in school or out of school.

Human brain's up take of information and what we learnIf human brains take up information at a fixed pace is it not possible that the useless information that we learn in school in order to make the grade squeezes out some other learning that might be more valuable in our lives? Rather than trying to teach children more maybe we should try to teach them more useful things.